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**UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549**___________________**FORM 10-QSB**___________________

(MARK ONE)[x] Quarterly Report Pursuantto Section 13 or 15(d) of the Securities Exchange Act of 1934For The Period Ended September 30, 2004OR[  ] TransitionReport Pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934**For The Transition PeriodFrom  ___________ To ___________** Commission File No.: 0-30685

**AIMSITECHNOLOGIES, INC.**(Exact Name Of RegistrantAs Specified In Its Charter)

| **Utah**
            
**87-0305395**

(State of Incorporation)
            
(I.R.S. Employer Identification No.)

 
                           
**702 South Illinois Avenue,    Suite 203, Oak Ridge, TN**
            
**37830**

(Address of Principal Executive Offices)
            
(ZIP Code

 Registrant'sTelephone Number, Including Area Code: (281) 686-0691

Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or forsuch shorter period that the registrant was required to file such reports), and (2) hasbeen subject to such filing requirements for the past 90 days. Yes  [  ]  No [X]Issuers Involved in Bankruptcy Proceeding During The Past Five YearsIndicate by check mark whether the registrant has filed all documents and reports requiredto be filed by Section 12, 13 or 15(b) of the Exchange Act after the distribution ofsecurities under a plan confirmed by a court. Yes [  ]  No [  ]

At September 30,2004, the Registrant had 64,595,635 shares of common stock outstanding.
****
**TABLE OF CONTENTS**
Item    Description    Page
**PART I - FINANCIAL INFORMATION**

ITEM 1.
            
FINANCIAL    STATEMENTS.
        3  
ITEM 2.
            
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL    CONDITIONS AND RESULTS OF OPERATION.
        3   
ITEM 3.
            
CONTROLS AND    PROCEDURES.
        4   
**PART II - OTHER INFORMATION**

ITEM 1.
            
LEGAL PROCEEDINGS.
        4  
ITEM 2.
            
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF    PROCEEDS.
        4   
ITEM 3.
            
DEFAULT    UPON SENIOR SECURITIES.
        4   
ITEM 4.
            
SUBMISSION OF MATERS TO A VOTE OF SECURITY HOLDERS.
        4   
ITEM 5.
            
OTHER INFORMATION.
        4   ITEM 6.EXHIBITS AND REPORTS    ON FORM 8-K.5****
**PART I - FINANCIAL INFORMATION**

**ITEM 1. FINANCIAL STATEMENTS**Back toTable of Contents

The Registrant's financialstatements for the three and nine-month periods ended September 30, 2004 and 2003 areattached to this quarterly report.

Financial Statements

**ITEM2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION**Backto Table of Contents

Forward-Looking Statements; Market Data 

As used in this Quarterly Report, the terms "we","us", "our","AIMSI", the "Registrant" and the"Company" means AIMSI Technologies, Inc., a Utah corporation, and itssubsidiaries. To the extent that we make any forward-looking statements in the"Management's Discussion and Analysis of Financial Condition and Results ofOperations" in this Quarterly Report, we emphasize that forward-looking statementsinvolve risks and uncertainties and our actual results may differ materially from thoseexpressed or implied by our forward-looking statements. Our forward-looking statements inthis Quarterly Report reflect our current views about future events and are based onassumptions and are subject to risks and uncertainties. Generally, forward-lookingstatements include phrases with words such as "expect", "anticipate","intend", "plan", "believe", "seek","estimate" and similar expressions to identify forward-looking statements. 
**Three and Nine Months Ended September 30, 2004 Compared to Three and Nine Months EndedSeptember 30, 2003.**
Consolidated net losses for the three and nine month periods ended September 30, 2004were $(688,169) and $(1,374,553), respectively, compared to a consolidated net loss of$(647,177) for the comparable quarter of 2003 and earnings of $133,653 for the nine monthsended September 30, 2003. During the three and nine-month periods ended September 30, 2004all operations were those of AIMSI because AIMSI Technologies, LLC had not commencedoperations.

Revenues for the three and nine months ended September 30, 2004 were $3,346,356 and$9,996,167 respectively, compared to $5,190,290 and $14,279,917 respectively, for thethree and nine-months period ended September 30, 2003. Selling, general and administrativeexpenses during the three and nine-month periods ended September 30, 2004, were $1,480,893and $3,141,867, respectively, which compares to $3,670,497 and $4,689,577 for the threeand nine months ended September 30, 2003.
**Liquidity and Capital Resources**
Total assets at September 30, 2004 and December 31, 2003 were $4,337,164 and$4,594,110, respectively.  Total liabilities at September 30, 2004 were $2,206,014compared to $3,672,063 at December 31, 2003. At September 30, 2004 consolidated workingcapital was $1,133,086 as compared to negative working capital of $(114,832) at December31, 2003. 

The Company's consolidated cash position at September 30, 2004 was $989,061 compared to$318,276 at December 31, 2003. Accounts receivable net of reserves at September 30, 2004was $1,934,761 compared to $2,987,434 at December 31, 2003.

For the nine months ending September 30, 2004, the Company used $707,099 in itsoperating activities compared to net cash used in operating activities of $1,898,959during the same period of the prior year. We had net cash used in investing activities of$165,498 during the nine-month period ending September 30, 2004, compared to net cashprovided by investing activities of $12,526 during the same period of the prior year.Financing activities provided $1,543,382 compared to $2,081,226 for the same period inprior year.

To fund future operations for the Registrant's subsidiaries, the Registrant has raisedcapital through a private placement. As of the date of this filing, the Company has raisedapproximately $5,000,000 through a unit private placement.

 

**ITEM 3. CONTROLS AND PROCEDURES**Back toTable of Contents

As of the end of the period covered by this report, theCompany conducted an evaluation under the supervision and with the participation of thechief  executive officer and chief financial officer of the Company's disclosurecontrols and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, the chief executive officer and chief financialofficer concluded that the Company's disclosure controls and procedures are effective toensure that information required to be disclosed by the Company in reports that it filesor submits under the Exchange Act is recorded, processed, summarized and reported withinthe time periods specified in Securities and Exchange Commission rules and forms. 

 

The Company also maintains a system of internal controlover financial reporting (as defined in Rules 13A-15(f) and 15d-15(f)) designed to providereasonable assurance regarding the reliability of financial reporting and the preparationof financial statements for external purposes in accordance with accounting principlesgenerally accepted in the United States. During the most recent fiscal quarter, there havebeen no changes in internal control over financial reporting that occurred that havematerially affected or are reasonably likely to materially affect internal control overfinancial reporting. 

 

During our last fiscalquarter, no change occurred in our internal control over financial reporting thatmaterially affected, or is reasonably likely to materially affect, our internal controlover financial reporting. However, following the enactment of the Sarbanes-Oxley Act andrelated SEC regulations, we have enhanced and continue to enhance our internal controlsand disclosure systems.

 

**PART II - OTHER INFORMATION**

**ITEM 1. LEGAL PROCEEDINGS**Back toTable of Contents

None.

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES ANDUSE OF PROCEEDS**Back to Table of Contents

During the second quarter June 30, 2004, we issued 63,066,005 restricted shares ofcommon stock in connection with the acquisitions of Advanced Integrated ManagementServices, Inc., a privately held corporation by the Registrant, which include sharesissued to current management and the prior shareholders of Advanced Integrated ManagementServices, Inc. The restricted shares were issued pursuant to Rule 506 and Section 4(2) ofthe Act.

During the quarter ended September 30, 2004, we commenced a privateoffering of units at an offering price of $2.00 per unit.  Each unit consisted of afully paid and non-assessable restricted share of the Company's common stock and a warrantto purchase an additional share of restricted common stock at an exercise price of $4.00per share.  The offering price is $2.00 per unit, with the proceeds being madeavailable to the Company, less fees and commissions of 10% paid to the placement agent, anNASD member firm, NevWest Securities, located in Las Vegas, Nevada. Since commencement ofthe private offering on August 4, 2004 and through the date this report was filed, thegross proceeds from the offering were $5 million and the private placement was concluded.

**ITEM 3. DEFAULTS UPON SENIORSECURITIES**Back to Table of Contents

None.

**ITEM4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**Back toTable of Contents

During the period ended September 30, 2004, the board ofdirectors, acting with the majority consent of Registrant's shareholders approved a shareexchange and acquisition agreement between the Registrant and AIMSI Technologies, LLC, aprivately held company. The share exchange and acquisition agreement received the consentof holders of 78%, a majority of the Registrant's issued and outstanding shares. 

**ITEM 5. OTHER INFORMATION**Back toTable of Contents

On August 12, 2004, the Board of Directors elected R. Everett Bassie to the Board ofDirectors and made him Chairman of the Audit Committee.

**ITEM 6. EXHIBITS AND REPORTS ONFORM 8-K**Back to Table of Contents

(a) The following documents are filed as exhibits tothis report on Form 10-QSB or incorporated by reference herein. Any document incorporatedby reference is identified by a parenthetical reference to the SEC filing that includedsuch document.
**Exhibit No.**
**Description**31.1Certification of Chief    Executive Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the    Sarbanes-Oxley Act of 200231.2
Certification    of Chief Executive Officer Pursuant to Section 906 of Sarbanes-Oxley Act of 200232.1Certification of Chief    Financial Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the    Sarbanes-Oxley Act of 200232.2Certification of Chief    Financial Officer Pursuant to Section 906 of Sarbanes-Oxley Act of 2002
(b) Reports on Form 8-K During the Period Covered by this Report:

The Registrant filed a Form 8-K on August 6, 2004 containing disclosureunder Item 1. Change in Control, Item 2. Acquisition or Disposition of Assets, Item 5.Other Events and Regulations FD Disclosure, and Item 6. Resignation of Registrant'sDirector. The Registrant filed also a Form 8-K on September 3, 2004 with disclosure underItem 4.01 Changes in Registrant's Certifying Accountants.

**SIGNATURES**

Pursuant to therequirements of the Securities Exchange Act of 1934, this report has been signed below bythe following persons on behalf of the registrant and in the capacities and on the dateindicated.
/s/    REGINALD HALL       CEO AND CHAIRMAN       *Dated: November 24, 2004*  /s/    JOHN W. STUMP, III.       CHIEF FINANCIAL OFFICER       *Dated: November 24, 2004*
Certification of Reginald Hall,CEO and Chairman of AIMSI Technologies, Inc., pursuant to 18 U.S.C. ss.1350, as adoptedpursuant to ss. 302 of the Sarbanes-Oxley Act of 2002.

I, Reginald Hall, certify that:

1. I have reviewed this quarterly report on Form10-QSB of AIMSI Technologies, Inc.;

2. Based on my knowledge, this quarterly reportdoes not contain any untrue statement of a material fact or omit to state a material factnecessary to make the statements made, in light of the circumstances under which suchstatements were made, not misleading with respect to the period covered by this annualreport; 

3. Based on my knowledge, the financialstatements, and other financial information included in this quarterly report, fairlypresent in all material respects the financial condition, results of operations and cashflows of the registrant as of, and for, the periods presented in this quarterly report; 

4. As the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (asdefined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls andprocedures to ensure that material information relating to the registrant, including itsconsolidated subsidiaries, is made known to the undersigned by others within thoseentities, particularly during the period in which this quarterly report is being prepared;b) evaluated the effectiveness of the registrant's disclosure controls and procedures asof a date within 90 days prior to the filing date of this quarterly report (the"Evaluation Date"); andc) presented in this quarterly report management's conclusions about the effectiveness ofthe disclosure controls and procedures based on my evaluation as of the Evaluation Date;

5.  I have disclosed, based on my mostrecent evaluation, to the registrant's auditors:

a) all significant deficiencies in the design oroperation of internal controls which could adversely affect the registrant's ability torecord, process, summarize and report financial data and have identified for theregistrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management who have a significantrole in the registrant's internal controls; and

6.  I have indicated in this quarterlyreport whether there were significant changes in internal controls or in other factorsthat could significantly affect internal controls subsequent to the date of our mostrecent evaluation, including any corrective actions with regard to significantdeficiencies and material weaknesses.

Date: November 24, 2004, Reginald Hall, CEO andChairman                                  /s/ Reginald Hall

Statement Pursuant to Section906 of Sarbanes-Oxley Act of 2002

The undersigned, Reginald Hall, CEO and Chairmanof AIMSI Technologies, Inc., a Utah corporation, hereby makes the following certificationas required by Section 906(a) of the Sarbanes-Oxley Act of 2002, with respect to thefollowing of this quarterly report filed pursuant to Section 15(d) of the SecuritiesExchange Act of 1934: Quarterly Report of Form 10-QSB for the period ended September 30,2004.

The undersigned certifies that the abovequarterly report fully complies with the requirements of Section 15(d) of the SecuritiesExchange Act of 1934, and information contained in the above quarterly report fairlypresents, in all respects, the financial condition of AIMSI Technologies, Inc. and resultsof its operations.

Date: November 24, 2004, Reginald Hall, CEO andChairman                                  /s/ Reginald Hall

Certification of John W. Stump,III, Chief Financial Officer of AIMSI Technologies, Inc., pursuant to 18 U.S.C.ss.1350, asadopted pursuant to ss. 302 of the Sarbanes-Oxley Act of 2002.

I, John W. Stump, III, certify that:

1. I have reviewed this quarterly report on Form10-QSB of AIMSI Technologies, Inc.;

2. Based on my knowledge, this quarterly reportdoes not contain any untrue statement of a material fact or omit to state a material factnecessary to make the statements made, in light of the circumstances under which suchstatements were made, not misleading with respect to the period covered by this quarterlyreport; 

3. Based on my knowledge, the financialstatements, and other financial information included in this quarterly report, fairlypresent in all material respects the financial condition, results of operations and cashflows of the registrant as of, and for, the periods presented in this quarterly report; 

4. As the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (asdefined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls andprocedures to ensure that material information relating to the registrant, including itsconsolidated subsidiaries, is made known to the undersigned by others within thoseentities, particularly during the period in which this quarterly report is being prepared;b) evaluated the effectiveness of the registrant's disclosure controls and procedures asof a date within 90 days prior to the filing date of this quarterly report (the"Evaluation Date"); andc) presented in this quarterly report management's conclusions about the effectiveness ofthe disclosure controls and procedures based on my evaluation as of the Evaluation Date;

5.  I have disclosed, based on my mostrecent evaluation, to the registrant's auditors:

a) all significant deficiencies in the design oroperation of internal controls which could adversely affect the registrant's ability torecord, process, summarize and report financial data and have identified for theregistrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management who have a significantrole in the registrant's internal controls; and

6.  I have indicated in this quarterlyreport whether there were significant changes in internal controls or in other factorsthat could significantly affect internal controls subsequent to the date of our mostrecent evaluation, including any corrective actions with regard to significantdeficiencies and material weaknesses.

Date: November 24, 2004, John W. Stump, III,Chief Financial Officer                                  /s/ John W. Stump, III

Statement Pursuant to Section906 of Sarbanes-Oxley Act of 2002

The undersigned, John W. Stump, III, ChiefFinancial Officer of AIMSI Technologies, Inc., a Utah corporation, hereby makes thefollowing certification as required by Section 906(a) of the Sarbanes-Oxley Act of 2002,with respect to the following of this quarterly report filed pursuant to Section 15(d) ofthe Securities Exchange Act of 1934: Quarterly Report of Form 10-QSB for the period endedSeptember 30, 2004.

The undersigned certifies that the abovequarterly report fully complies with the requirements of Section 15(d) of the SecuritiesExchange Act of 1934, and information contained in the above quarterly report fairlypresents, in all respects, the financial condition of AIMSI Technologies, Inc. and resultsof its operations.

Date: November 24, 2004, John W. Stump, III,Chief Financial Officer                                  /s/ John W. Stump, III

**FinancialStatements**Back to Table of Contents
Consolidated    Financial Statements   Balance Sheets-September 30, 2004 and December 31,    2003 (Audited)9   Statement of Operations - Three and nine    months ended September 30, 2004 and 200310   Statement of Cash Flows - Nine months ended    September 30, 2004 and 200311Notes to Consolidated Financial Statements12**AIMSI    TECHNOLOGIES INC.****Consolidated Balance Sheets**Back to    Table of ContentsSeptember 30, 2004    and December 31, 2003  (Unaudited)   
2004
2003
**Assets**(Audited)Current assets:
      Cash
$
989,061
$
318,276   Accounts    receivable, net of allowance1,934,7612,987,434   Retainage    receivable50,44445,152   Prepaid expenses    and other current assets364,834206,369        Total current assets3,339,1003,557,231   Investments in affiliates621,047312,465Property and equipment, net of    accumulated   depreciation and    amortization209,350708,600Other assets167,66715,814          Total assets$4,337,164$4,594,110
**Liabilities    and Stockholders' Equity**  Current liabilities:   Accounts payable    and accrued expenses$104,279$364,295   Accrued salaries    and related liabilities391,946328,218   Line of credit1,682,4132,899,706   Income taxes    payable27,37679,844        Total current liabilities2,206,0143,672,063            Total liabilities2,206,0143,672,063  Stockholders' equity:   Common stock,    $.001 par value. Authorized 100,000,000 shares:         64,595,635 shares issued and outstanding at September 30, 2004,     1,000    shares issued and shares outstanding at December 31, 200364,5961,000   Additional paid-in    capital2,535,4195,359   Retained earnings(468,865)(915,688)     Total    stockholders' equity2,131,150922,047        Total liabilities and stockholders' equity
$4,337,164$4,594,110See accompanying    notes to consolidated financial statements**AIMSI TECHNOLOGIES INC.****Consolidated    Statements of Operations**Back to Table of ContentsThree and nine-months ended September, 30 2004 and 2003    (Unaudited)  
Three months ended September 30,
Nine months ended September 30,      20042003
2004
2003Revenues $3,346,356$5,190,290
$
9,996,167
$
14,279,917Costs    and expenses:       Cost of sales 2,555,6952,109,991
8,275,549
9,292,219      Selling, general and administrative 1,480,8933,670,497
3,141,867
4,689,577        Total operating expenses 4,036,5885,780,488
11,417,416
13,981,796      Operating income (loss)(690,232)(590,198)
(1,421,249)
298,121      Other    income (expenses):       Interest income-931
98
1,729      Gains on equity in investments50,79639,763
107,795
144,263      Interest expense(50,347)(24,877)
(60,674)
(65,459)      Other income (expense)40(105,142)
190
(26,696)        Total other income (expenses)489(89,325)
47,409
53,837          Net    earnings (loss) before income tax(689,743)(679,523)
(1,373,840)
351,958Provision    for income taxes1,57432,346
10,713
218,305    
  
      Net earnings (loss)$(688,169)$(647,177)
$
(1,384,533)
$
133,653      Net earnings (loss) per share$(0.01)$(647.18)
$
(0.02)
$
133.65  Weighted average common shares - basic and diluted Basic64,405,3291,000
61,363,930
1,000  See accompanying notes to consolidated financial statements**AIMSI TECHNOLOGIES INC.****Consolidated    Statements of Cash Flows**Back to Table of ContentsNine months ended September 30, 2004 and 2003(Unaudited)        
2004
2003Cash    flows from operating activities:    Net earnings (loss)
$
(1,384,533)
$
133,653      Adjustments to reconcile net earnings (loss)        to net cash used in operating activities:           Depreciation and amortization 
61,956
61,956          Common stock issued for services 
435,773
-          Equity in earnings of affiliates(107,795)(144,263)          (Increase) decrease of operating assets:              Accounts receivable 
1,052,673
(1,638,743)             Retaining receivable
(5,292)
(78)             Prepaid expenses and other current assets
(158,465)
(165,889)             Other assets 
(151,853)
6,563          Increase (decrease) in operating liabilities:             Accounts payable and accrued expenses(433,427)(266,662)             Accrued salaries and related liabilities63,728212,378             Income taxes payable(79,844)(97,874)             Net cash    used in operating activities 
(707,099)
(1,898,959)  Cash    flows from investing activities:       Purchase of property and equipment
(165,498)
(131,737)      Proceeds from investment in affiliate
-
144,263            Net cash    provided by (used) in investing activities 
(165,498)
12,526      Cash    flows from financing activities:       Net proceeds from private placement of common stock
2,760,675
-      Net borrowing (repayment) under line of credit agreements
(1,217,293)
1,243,213      Increase in bank overdraft
-
838,013            Net cash    provided by (used in) financing activities 
1,543,382
2,081,226                 Net decrease in cash 
670,785
194,793  Cash at    beginning of year 
318,276
46,778Cash at end of period
$
989,061
$
241,571      Supplemental    schedule of cash flow information:       Interest paid 
$
60,674
$
78,536      Income taxes
-
80,295  See accompanying notes to consolidated financial statements
**AIMSITECHNOLOGIES INC.**Back to Table of Contents****Notes to Consolidated Financial Statements
**Nine Months Ended September 30, 2004 and 2003

**(1) General**

The business of AIMSI TECHNOLOGIES, INC. (the "Company" or "AIMSI")consists primarily of engineering, scientific and technical services in nuclear andenvironmental service and information technology management.  The Company operates inseveral states with its corporate offices located in Oak Ridge, Tennessee.
**Principles of Consolidation**
The consolidated financial statements include the accounts of the Company and itswholly-owned subsidiary: AIMSI Technologies, LLC.  All significant intercompanytransactions and balances have been eliminated in consolidation.

The accompanying unaudited financial statements have been prepared in accordance withU. S. generally accepted accounting principles ("GAAP") for interim financialinformation and with the instructions to Form 10-QSB.  Accordingly, they do notinclude all of the information and footnotes required U. S. generally accepted accountingprinciples for complete financial statements.  In the opinion of management, alladjustments (consisting of normal recurring adjustments) considered necessary for a fairpresentation have been included.  Operating results for the nine months period endedSeptember 30, 2004 are not indicative of the results that may be expected for the yearending December 31, 2004.

As contemplated by the Securities and Exchange Commission (SEC) under Rules ofRegulation S-B, the accompanying financial statements and related footnotes have beencondensed and do not contain certain information that will be included in the Company'sannual financial statements and footnotes thereto.
**Revenue Recognition**
The Company provides services to customers primarily on a per unit basis.  Theaccompanying financial statements are presented on the accrual basis of accounting. However, long-term construction contracts have been accounted for using thepercentage-of-completion method of accounting, measured by the percentage of total costsincurred to date to estimated total costs for each contract.

Contract costs include all direct job costs and those indirect costs related tocontract performances, such as indirect labor, supplies, insurance, equipment repairs, anddepreciation costs.  General and administrative costs are charged to expense asincurred.  Provisions for estimated losses on uncompleted contracts are made in theperiod in which such losses are determined.  Changes in job performance, jobconditions, and estimated profitability, including those arising from final contractsettlements, may result in revisions to costs and income and are recognized in the periodin which the revisions are determined.
**(2) Use of Estimates**
The preparation of financial statements in conformity with U. S. general acceptedaccounting principles requires management to make estimates and assumptions that affectthe reported amounts of assets and liabilities and disclosure of contingent assets andliabilities at the date of the financial statements and the reported amounts of revenuesand expenses during the reporting period.  Actual results could vary from thoseestimates.
**(3) Business Combination**
The Company is a result of a business combination on May 14, 2004, between CarminaTechnologies, Inc., a public shell company, and Advanced Integrated Management Services,Inc., a privately held company, incorporated in the State of Tennessee in 1994. Carmina Technologies, Inc. acquired all of the outstanding capital stock of AIMSI byissuing 8,640,000 shares of its restricted common stock.  For accounting purposes,however, the acquisition has been treated as the recapitalization of AIMSI with AIMSIdeemed the acquirer of Carmina Technologies, Inc. in a reverse merger.  At theconclusion of the merger, AIMSI stockholders held 80% of the combined company.  As areverse merger, the historical operating results prior to the acquisition are those ofAIMSI (the private company) and only the operations of Carmina Technologies, Inc. afterthe acquisition.  In addition, Carmina Technologies, Inc. formerly changed its nameto Advanced Integrated Management Services, Inc.  Carmina Technologies, Inc. had noassets, $130,000 of liabilities as of the day the agreement was formerly closed (June 29,2004).

On June 27, 2004, in a related transaction, the Company entered into an agreement toacquire 100% of the issued and outstanding ownership interests in AIMSI Technologies, LLC,a privately held Tennessee limited liability company, in another share exchangetransaction, which was subject to non-material adjustments based upon Tennessee law. TheCompany acquired 100% of the Shares of AIMSI Technologies, LLC, by issuing 2,000,000shares of its restricted common shares.

On October 19, 2004 the Board Of Directors voted to terminate the agreement with thecurrent Chairman of the Board and Chief Executive Officer, Reginald Hall, canceling36,117,256 shares of restricted common stock previously issued to Reginald Hall based onthe agreement. The board of directors, including Reginald Hall, agreed unanimously to thisdecision. The board is currently negotiating a new performance based agreement.

Also on October 19, 2004 the Board of Directors voted to change the company's name toAIMSI Technology, Inc. and to increase the number of authorized shares of capital stockfrom 100,000,000 to 300,000,000, with 280,000,000 designated as common stock and20,000,000 designated as preferred stock.

Additional information regarding these changes can be found in the filings and pressreleases attached as an exhibit to Form 8-K.

On October 26, 2004, Advanced Integrated Management Services, Inc. announced a 5-for-1stock split payable November 15, 2004 to shareholders of records on October 22, 2004
**(4) Recent Accounting Pronouncements**
In January 2003, the FASB issued SFAS No. 148, "*Accounting for Stock-BasedCompensation - Transition and Disclosures."*  This statement providesalternative methods of transition for a voluntary change to the fair value based method ofaccounting for stock-based employee compensation.  In addition, this Statement alsoamends the disclosure requirements of SFAS No. 123 to require more prominent and frequentdisclosures in the financial statements about the effects of stock-based compensation. The transitional guidance and annual disclosure provisions of this Statement wereeffective for the December 31, 2002 financial statements.  The interim reportingdisclosure requirements became effective for the first quarterly report in 2003. Because the Company continues to account for employee stock-based compensation underAPB Opinion No. 25, the transitional guidance of SFAS No. 148 has no effect on thefinancial statements at this time.  However, the accompanying financial statementspresented have incorporated the enhanced disclosure requirements of SFAS No. 148.

In May 2003, the FASB issued SFAS No. 150. "*Accounting for Certain Instrumentswith Characteristics of Both Liabilities and Equity*," which establishes standardsfor how an issuer classifies and measures certain financial statements withcharacteristics of both liabilities and equity.  SFAS No. 150 requires that an issuerclassify a financial instrument that is within its scope, which may have previously beenreported as equity, as a liability (or an asset in some circumstances).  Thisstatement is effective for financial instruments entered into or modified after May 31,2003, and otherwise is effective at the beginning of the first interim period beginningafter June 15, 2003 for public companies.  The Company does not believe that theadoption of SFAS No. 150 will have a significant impact on its financial statements.** |
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